Monday, November 30, 2009

Black Friday came and now it is time for Cyber Monday.Black Friday is a do or die for most retailers. If they make it good here, fine otherwise they have to discount even more. I also went to Target for some stuff in the afternoon. There was rush but not the kind that you would suffocate. It is surprising to see so many people even after you read all the news about how people are losing their jobs and having a hard time making ends meet. But I guess people love a deal and they went out in droves. The deals were good and people really bought stuff which they need and some which they did not simply because they were unable to resist a good deal.

But my point here is that the deals people see now are the real price of the things. It is that all year long the prices are marked up so high so that the profit margins of these retailers are up to satisfy the Wall Street and analysts and of course the investors. But since this year is special due to the recession the retailers have started to panic and the drive to having a good deal to persuade people to buy their stuff has never been greater.

But again here is the dilemma, the people are so stressed out with all the debt that either they don’t have the money to spend or a reluctant to spend but the retailers are enticing people to spend because if they don’t then the retailers will have to slash prices even more hurting their bottom line and also laying off their workers which in turn will lead to more joblessness and less customer traffic. So it is a catch-22 situation where the customers are reluctant to spend but the retailers have to sell in order to keep their employees and lower the jobless rate and if they don’t sell then there will be layoffs whose unemployment insurance will indirectly be financed by the same reluctant customers. Lets us see how Cyber Monday goes.

Ah! This is one movie I will recommend to anybody. It is a fantastic Martial Arts movie showcasing the extra ordinary talent of the Late Bruce Lee. He plays an agent who is sent to an island to find out the shenanigans of the island owner, who is producing drugs in his lab and gather evidence against him. Although it is only one of the five or so movies that Bruce Lee made but it was the best he did. It also stars John Saxon, Jim Kelly and female Martial Artist Angela Mao. Well developed story, great martial arts and watching the Late Great Bruce Lee in Action is worth watching this movie from time to time. Highly recommended (especially if you are Martial Arts fan).

Another one of those comedies where if you have time to kill, it is okay fun. It stars Kevin James (of King of Queens fame) as a failed New JerseyState trooper out of love working as a security guard in a New Jersey Mall, who gets a chance at love when his Mall is taken over by robbers. He falls in love with a cart girl and that girl along with his daughter is taken hostages. He springs into action despite the fact that he is not trained to do all the law enforcement work and have diabetes. If you have seen King of Queens, you will feel familiar with Kevin James style comedy. Not a terrible waste of time, but if you have not watched it, you would not miss it either. Recommended (only if you have nothing to do). Running time: Approximately 90 minutes.

Over the weekend I watched Bride Wars Starring Anne Hathaway and Kate Hudson. It is about two childhood friends who arrange to have their wedding in New York Plaza Hotel but due to a clerical mistake both had it the same day and the same time. The best friends become enemies in order to wreck each other’s wedding day. It is an okay movie, thankfully a small one about 90 minutes. If you have the time to kill, watch it but I would rather skip it and do some productive work. Formula story and acting was okay.

Saturday, November 28, 2009

The last thing to do is to have a stepped up effort to track all financial and material support to terrorist organizations. Funding in the guise of Charities should be monitored and no effort should be spared to put those people responsible for funding to put them out of business.We are in a different kind of war and some of the niceties of laws would have to be bended in order for us to win this war. The Taliban are usually funded through religious charities and wealthy individuals and these should be monitored and tracked especially in the Gulf and European countries.But we should also make sure that people in the United States should also not flaunt the law and give charities which can be used as funding by the terrorist organizations.Drug money and extortions by the taliban in Pakistan should be followed and seized immediately if proven. We have been too lax to apply our laws to curtail these fundings which are used to kill our troops. Our troops deserve a fair fight and they should not be subject to terrorism. If we believe that this is a different kind of war then all the rules of a conventional war should not be applied and the troops should be free to use whatever means necessary to secure themselves from Taliban suicide bombers even if means collateral damage since there will be some innocent blood spill but that is what we call WAR.

Friday, November 27, 2009

The seventh thing to do is to convey in certain terms to the Government and the Armed forces of Pakistan that any plan or attack on the United States and its allies with links to them will be dealt with accordingly. We all know that Pakistan is concerned about Indian Infiltration in Afghanistan affairs and Pakistan does not like the fact that they have become marginalized in that country due to the support of India and America to the Northern alliance but Afghanistan is nobody’s fiefdom and it should be made clear that support of Taliban factions by various Pakistan entities is not welcome.

If Pakistan wants to be player in Afghanistan or if it is waiting that as soon as the NATO and American forces leave that country, they will be able to bring back the Taliban Government in Afghanistan, then they should be told that the games have now changed and they will have to play by the new rules, lest they want to jeopardize the American Aid.

Irrespective of how much Anti-American there is prevailing in Pakistan, it should not be a substitute of blanket American Support. Pakistan instead of playing favorites in Afghanistan should deal with its own Baluchistan and the Taliban faction that is trying to derail the government there and also the rampant corruption (not acknowledged by government officials) and the provision of necessities of its own people.

Here I would like to emphasize that Pakistan and its people have been too much obsessed with India since independence and there whole concentration is on India even if it can’t provide food and other necessities to its people. If the people don’t want to see what they really need in their lives, then it is their problem, but they should not be allowed to destabilize other countries.

The fifth thing is to curtail the flow of arms and Taliban Fighters from across the border.

The free flow of human and arms trafficking from across the border can be reduced but it can never be eliminated because of the long porous border with Pakistan and also to convince Pakistan to tighten their side of the border. We have to capacity and the manpower (after the surge) to monitor these things through satellites and drone technology.

The sixth thing is that the U.S. government should make sure that that territory is never used again as a safe haven for terrorist organizations nor launching an attack on the United States. We need to all the stakeholders to make sure we make our point across on this point. There should not be any compromise on this solution even if we have to take steps which may be unpopular in some stakeholder’s interests.

We have to stabilize the country of Pakistan in all matters since that is where this majority of arms and People are coming, no matter what and how much they protest on the contrary. It is no hidden fact that Pakistan has a big stake in the Afghanistan scenario and we should take that into account but it should not be at the expense of American interests.

The third thing that we should do is to deal directly with these warlords that hold a large area of Afghanistan under their thumb. I know that they are corrupt and will cut out deal with anybody they see fit but they are the key to stabilization. Since they have a large and loyal force with them and with the right incentives they can be on our side. I know that incentives mean a little bit of bribery here and there. Although it is forbidden by the American law to bribe foreign entities in order to get something but if that is what it will take to bring stability to Afghanistan ( and in the process reduce our exposure and losses) so we will have to swallow this bitter pill. That is the name of the game there and we will have to bend some rules (although I am sure we bend more than some rules in order to accomplish a specific target) in order to get what we want.

The fourth thing we have to do is to talk to the Taliban directly or indirectly. We will have to convince them that we are just there temporarily. It is their country and land and we can’t stay there indefinitely but we need to convince them that their land should not be used for terrorist activities. If they still do not agree to this and first insist on us to leave them alone and then they think about what to do, and then we will have no choice but to remain there indefinitely. But the first thing is to talk and convince them about our intensions and goals there.

The first thing that needs to be done is Corruption. Corruption is now the biggest problem in Afghanistan. In order to survive, the new Afghan government has to bribe all sorts of people with different needs and agenda in order to effectively govern. It is not that we will completely eliminate the corruption there but at least we need to curtail it to the extent that the people there can see where all the foreign money in going and if this means we have to bypass the Afghan government in some cases so be it. At least we will know and see what effect our aid is having on the Afghan population.

The Second thing is the porous border with Pakistan. That border is actually not a border recognized by either sides and it is called the Durand line (Named after the British guy who just put a line in the sand stating that this is you and this is us long time ago). People will say that how we can monitor the Afghanistan border when we are not able to control our own border with Mexico. But there is a big difference, our border with Mexico is not controlled the Armed forces of the United States but in Afghanistan it does. Although the Afghan people (effectively right now the Pushtuns) have never recognized this border and keep on crossing it like it is just the next block in the neighborhood.

Nobody is stopping them to just curtail this thing but it can still be monitored for arms and Taliban fighters. For this we have to put more troops there and strictly monitor the long border with as many troops as possible.

President Obama will announce in a few days his new policy regarding the number of troops he is prepared to send to Afghanistan at the request of the commanding General there. The hope is that as the surge of this troop (as it is now called) will have the same effect as that has happened to Iraq. Less violence and more stability and faster time to get out from there.

It is too early to tell whether this kind of surge will work as well or not. But in my opinion that surge is not going to work as well as that happened in Iraq for various reasons (which I will elaborate further). Afghanistan is very different than in Iraq where there was already a functioning government before the invasion and people have a sense of identity and hope. But Afghanistan will need to have a radical departure of what is happening now and what it expects to be in the future.

The surge in order to succeed will depend on many reasons, the following of which I will elaborate in details.

1. Corruption should be stopped or curtailed.

2. Border with Pakistan has to be monitored.

3. Americans have to deal with the warlords there in order to secure the countryside.

4. They will have to talk either directly with the Taliban or use all necessary force to convince them to give themselves up.

5. The flow of arms and people will have to be curtailed from across the border from Pakistan

6. Americans will have to devise a strategy to make sure that Afghanistan is never again be used to launch any terrorist attacks against any country.

7. The Government and the Army in Pakistan will have to be told in certain terms about the consequences of any plan or attack ever taking place on America or its allies with links to them.

8. Tracking of financial and material support will have to be stepped up in all countries

I just finishing watching " The day the earth stood still". It is a 2008 science fiction film remake of the same name in 1951 with better special effects and not so top name actors. It stars Keanu Reeves as a alien who has come to earth to warn them not do destroy it and in the process destroys half of planet earth. It also stars Jennifer connelly as a scientist trying to convince him not to destroy it. It also stars Kathy Bates as the Secretary of Defense trying to destroy Keanu.Overall it is a good remake with good special effects and an effective time killer.The movie does not drag along and if you have not seen the original version you will definitely enjoy this one. Otherwise as the science fiction movies goes, its special effects are not that over whelming but the acting of the leading characters could be more enhanced.But given the story line, any actors in this movie would have been the laden with the same wooden acting. But i will still recommend this movie.

Tuesday, November 24, 2009

A new report (survey) came out today that was going to state the obvious that almost 23 percent of the people have mortgages which are under water (meaning the people owe more mortgages than their houses are worth). This was going to happen sooner or later.

People bid too much on the houses in the hope that the house prices will go up and they will be able to cash out. This was done with all the advises coming from various so called experts that historically house prices have never come down. Well guess what it has now come down and people don’t have equity in their houses to cash out in case they are in dire needs of finances.

I still not get it. How could people have thought that the prices of houses will go up? Did they not realize that the income of people have to go up proportionately with the prices otherwise the buyers can not afford the houses. Well I guess it was a huge party based on as they say house of cards and now it has fallen down. Lets see how many people will just walk away from their under water houses and how much this foreclosure wave will affect the banks and other financial institutions. But it does not look pretty whatever the numbers game (the statistics) tell you otherwise. It is really a shame for these people but blaming others (banks, real estate agents, experts etc) for this mess does not completely absolve people of their share of unjustified frenzy that accompanied their buying without having the means to do it. I mean how much intelligence you need to have in order to know how much you can afford a certain thing.

So the property taxes may not be the cure all in all states but they can be really helpful in California. Next although it is painful but the education budget should be cut and gasoline taxes should be raised. Sales taxes in most states are already high so it is useless to add more to these taxes. If they want to spur growth, most of the things should be done online and corporate taxes should be cut. Luring companies with tax cuts will help in the short term but why give it to one big company. Spread the incentives around so that you can have diversified bunch of industries and less reliant on one particular industry.

As is being done in the private sector regarding steadily erosion of pension and replacement of it by 401k and other private plans. So (although it will be highly unpopular) the pensions guaranteed to the public sector employees should either be steadily decreased or completely replaced by private sector savings. People are smart enough to make their own decisions then to rely on big Brother (or daddy) to make the decisions for them.

Sin taxes like alcohol and cigarettes taxes should be raised much higher than they are now. But I really oppose the leasing of the toll roads on some states to private sector so that the State can have a one shot money infusion. These are too lucrative to be handed over to the private sector for much less money. People think that the private sector may be more efficient in handling money than the public sector. But as this economy has showed private sector can be as inept as the public sector. Since the economy is fluctuating so much and there is not much chance that it will rebound soon, the states should make only one or at most 2 years contract with unions so that they may have the flexibility to change when the revenues go up or down and they should stop catering or pampering the Unions (although I have nothing against them) as times have now changed and the world has changed. We should be ready to accept the new economic times we are in lest we may fall down very hard.

The States have been too generous in granting raises to public employees when the times were crazy. But they were trying to avoid strikes by public employees and in order to placate them, they kept on adding expenditure. At flush times it would have been great to share the wealth, but times have now changed for the worst, and this cannot work any longer. The cuts have become very deep and painful and it keeps on coming.

This downturn is so bad that the states keep on revising downward their revenues and still the most conservative estimates are way off the mark for most states. You know that the states don’t have the luxury to print money and keep on piling on debt. Most of the states are under mandatory law to balance their budget every year unlike the Federal Government (although as far as I can recall, we did have a law to balance the budget but that is another story).

Now how to fix all the mess that the states are in right now. Property prices are falling making the taxes on property less predictable, hunger is increasing, and there is pressure on Medicaid and food stamps. Homelessness is growing and people are declaring bankruptcy in increasing numbers, foreclosures are rising despite all the government efforts. So what to do now. Well the states government doesn’t have much in their arsenal to wither this downturn except to cut and reduce spending and tax people.

Cutting will have to be done in every sector except emergency services, the raises of the government employees will have to be stopped and more furlough will have to be implemented. Aid to schools will have to be curtailed and taxes will have to be raised across the board.

I mean that property taxes will have to be reconsidered at least in California where the demand for services is the greatest but the revenues streams is the shortest right now.

Monday, November 23, 2009

Due to this economy and because the States did not see what was coming to them just like normal people, the budget deficits of states have become an ever expanding hole.

Look at what is happening in California. There the budget deficit is ever expanding and recently the California University System had to increase tuition fee by 32 percent which is a very steep increase.

I believe that this is because most of California’s revenue comes in the shape of Personal Income. The famous proposition that the voters in California passed three decades ago regarding capping the property taxes to a certain percentage has started to come to haunt the California Citizenry. Due to this they are unable to collect more taxes during these times. It was fine when the economy was growing and more money was coming in than going out. But the equation has now changed and California is facing a money nightmare.

You know that people want all the facilities but they don’t want to pay for it too much. This is what is happening across the country as state after state is in dire need of funds and have to cut right and left.

Even the states that had saved for the rainy day and started to deplete it faster than they can replenish it. They don’t know where to cut and where to preserve as the Politicians are reluctant to cut the popular programs but they don’t know how to bring in the much need revenues. California maybe an extreme case but other states are not far behind including New York, New Jersey, Connecticut and several others.

Now where does all this lead to in terms of facilities provided to the needy and poor and the weak and the running expenses of the states. This I will discuss in the next article

Like a household which is having trouble balancing its budget and depending on loans to get by. America has been too long living beyond its means and the debt will soon start to get unmanageable. Plus this debt keeps on adding up without any corresponding decrease in any outstanding debt. No Politician of any party or any Public figure has directly addressed how we are supposed to meet our obligations without declaring bankruptcy. They keep on adding spending and legislating laws and expect the investors of the world to keep on financing this huge appetite of American Deficit.

We need to start addressing this problem right away (the polls have started to show that Americans are increasingly worrying about the debt). We need to reduce our spending drastically which will mean some painful cuts now in order to lead a less indebted life and start paying off our obligations.

And you know what this obligations just show what we owe to the rest of the world and to our investors here. But it does not show what we owe to American Public in terms of what we have promised them. The unfunded liability of pensions and social security is another explosive debt which will have to be addressed now rather than being avoided by all the Politicians.

Where is the money going to come to fund all these liabilities are beyond me? We keep on promising people money without the means to find out where it will come from. So the future generation will definitely be paying more in taxes and reduce living standards just to keep up with the interest payments and our other obligations.

I read an interesting article in NYT regarding how America is being burdened with a huge debt load. The article says that by the year 2019 America would alone be paying nearly USD 700.00 Billion dollars in interest. This is really outrageous and worrisome picture. As we have seen before if you keep on borrowing money and spending it without having the means to pay for it can lead to disaster.

Household budget can be taken as an example. What do you believe that if you keep on borrowing money and paying interest on it, will it not become unmanageable? The creditors can stop lending to you, your credit can suffer and the creditors can demand either very high interest rate to keep on lending to you or just stop lending you altogether.

The same can happen to a country’s debt. America is lucky enough that it finances its debt by its own currency and people have faith in its ability to pay back what they are owned. But there will just come a point that the debt will be deemed to be too big for the investors to keep on lending (or buying) treasury securities. And that is when the rates will keep on going up so that America can finance its Budget.

Although others countries like Italy, Germany, Japan, the U.K.also have high debt as compared to their GDP but we should be worrying on our side. Because if America is unable to pay its debt obligations (highly unlikely right now) it will have disastrous consequences the likes of which the world would not have seen before.

Friday, November 20, 2009

I am not saying that we should be like China staying away from World events. But now we have to be realistic about what we can and can not do. We have to look at our finances and choose the best course to attain the maximum results to safeguard our interests. But interests should also be defined so that we should not be bogged down in situations where we don’t have clear cut mission or interest.

To be fair right now, Americans are too much occupied with their own finances to worry about people in far away places which they don’t know about or care about in cases. Right now they are worried about how to avoid foreclosure, how to find a job that pays (just pays nothing else) how to have health care without going in too much debt, worry about their retirement prospects, about their children’s future. The least thing they care right now is American interests getting threaten abroad.

So we have a unique opportunity to realign our priorities and take care of our problems first and then think about the world problems. Because seriously we are in no position anymore to solve every damn problem that arises in the world that may need the American attention while the rest of the world watches on the sidelines?

Now lets us see what interest means. As a superpower, we do definitely have interests but with the new economic situation and reality we need to narrowly define our interests. Let’s see do we have interest in Pakistan and Afghanistan-yes we do and in the middle east- we definitely do there too. But to tell you the fact, we should strive for peace but we should not believe that everybody in the world will like and love us. We don’t need to intervene to make the governments go our way. The more we intervene in the internal affairs of other countries, the less love there is and the more hostility you will encounter there.

We need not be interfering needlessly in other countries businesses unless it narrowly defines what kind of effect it would have on us. See we are a Superpower and we should not be afraid if some country becomes hostile to us. We should see that what we did in the first place to merit that hatred and hostility. We will have to self-evaluate and judge our selves harshly. And try to amend our mistakes.

Well some of our representatives will say that it weakens us if we apologize too much but you know if we want to seen as favorable we will have to make some harsh and stark decisions whether we like it or not.

Thursday, November 19, 2009

Now most of you will say that I am reverting to the isolationist mode and we should now engage more with the world. But I am no isolationist and we can still engage with the world by more practical measures than to use force. If we see China now, they are just trying to provide more relief and opportunities to their people (at the expense of us American to be true). If we were not so spendthrift to import everything from China, China would now still be struggling but not that much. Remember we made it happen for them. But now we should learn from the New China and start reassessing our role in the world whether we like it or not.

It is now a new World order being shifted to the East. If we want to be a part of it then we will have to spend less, save more, cooperate more and be sensitive to what other people are thinking about us without sacrificing our interest.

If the Europeans demand us to be protective of them, then they should shoulder more of the expenses and less on U.S. tax payers. We are already in too much debt to the world’s Policeman and we should be demanding more from other countries. It is time now to start cleaning our financial mess and worry more about us than what kind of interest we need to protect in other parts of the world.

Now that we have established more or less the fact that we need to realign our forces in face of our new financial and political reality. Bringing back our troops from overseas basis will help us to protect homeland more effectively and save much more money than we are spending right now. The need is for now to have Rapid Reactionary Forces which can go in a moment’s notice to trouble spots and get the job done instead of assembling large armada of forces which may take huge logistics and lots of time to build up and then by that time the situation may have been rapidly changed.

Since the wars now are mostly being fought with non state actors (meaning those groups or individuals who don’t have any state backings) we need to develop small groups of Rapid Reactionary Forces to counter them. It will be easier and they will be more effective in dealing with these rogue agents.

Since most of these non state actors are located in dysfunctional countries openly hostile to the United States, these small forces will be ideal to go, get the job done and come back. Just to warn everybody that if we will be conducting this kind of War, we should also be prepared to suffer the consequences like casualties, hostilities and even hostages (which can be really painful) but in terms of cost effectiveness and objectives achievement it can be deal winner.

Now if we want to keep some forces in Germany, that’s fine, but it should be the barest minimum. Now we turn our attention to Japan, the second biggest economy in the world, where we still have bases. The question is why. Don’t we not trust them to defend their own country? If they are so advanced they can build use their technology to defend themselves. If the question comes to the KoreanPeninsula, we have enough forces there to defend the South Korea from North Korean invasion. And besides South Korea has a big army and then we have our forces, which we should keep there in view of the unpredictable nature of the North Koreans. But Japan I will definitely not want to keep forces there since we need to defend them anymore.

Now the point comes out if we don’t have forces there how will be able to defend Taiwan if China decides to come calling. Well China is not that naïve that they will invade Taiwan right away or anytime soon. We have still ample naval forces there to defend Taiwan and besides Taiwan has its own army to defend the island. And by the way China would not want to jeopardize all its economic being with a disastrous war with the United States. So let’s be realistic about our defense forces in the Far East and start realigning it with our new financial reality and Political conditions in the Far East.

Wednesday, November 18, 2009

This Europe is not the same as it was in 1945 or even after. Great Britain and France are nuclear weapons and clearly seems to defend itself. Even Europe’s biggest economy Germany has enough armed forces to defend itself and others. The former Soviet Union (Now Russia) has no intention to invade the Western side of Europe. If you think that Georgia was invaded. Well it was in the neighborhood and some Russia still thinks it is their neighborhood. But they did not invade Hungary, Poland, ChezkRepublic or other countries since they were already independent before they were forced into the Warsaw Pact treaty.

But as I said before we have two nuclear armed powers and one ready to go if it wants to defend the whole continent along with other small armies. So why the needs to keep such a large American force is beyond my comprehension. If anybody can explain the reasoning I am all ears. Otherwise we need to keep a token force of very small force if need be and bring back rest of the forces. And also Russia is in no mood to start a War and destroy what is left remaining of it, just to have the glory of being a Superpower again. They have too much to loose economically and gain nothing from a military adventure (which by way it has not done since 1945) by invading the West.

The point that was missed in the article is that we have too many unnecessary commitments and have not have enough money to do it. We can’t and should not be the world’s policeman (or policewoman if you would like to call it that). We cannot solve all the world’s problem by ourselves when we have enough of our own. And now we are solving problems by borrowing money from other entities. This thing has to stop. You know there is a saying that “Charity begins at home”. We should follow this saying and starting fixing our problems before we try to solve others.

China is trying to solve its problems first like poverty and hunger and infrastructure, even it moves to make itself militarily stronger. Although I know that as being a superpower we need to be responsible and take our share of the burden, but we will be stronger if we take care of our house first. Take for example, the cold war is finished, done with and we still continue to have our forces in Germany and Japan- What for May I ask?

Do we still expect the Warsaw Pact to come invading the western side of the free world?

People of all strides now we don’t have Warsaw Pact. People got sick of them and got rid of it. There is no Checkpoint Charlie dividing the East and West Germany but we keep on having thousand of troops to do what-intriguing question. I don’t think anybody significant has raised this point. The prosperous Europe that we see right now is the fruit of the American public, which is already drowned in debt. How can we keep on insisting on having our forces in Europe when there is no need to keep it there with our finances in mess? Even if we see the need, do we need that massive presence there?

The third thing mentioned was the healthcare and moral support provided by the families. It is really a non issue that you are going to abandon your elderly relatives (especially your parents) in a nursing home to rot (no offense). In China people take pride in taking care of their parents as they have been taken care of when they were little. Although I can understand that the health care in China is not that great and the culture is also different but when you take care of your parents, it is a really win-win situation.

I know that it is an independent spirit of the American People to become independent as soon as they are 18. But in this economy it has become a rude wakeup call for some of them to come back to where they started. The win-win situation that I am discussing above refers to the fact that the Grandparents can take care of the kids while the parents work and it reduces the cost of Child Care. Because to be frank, nobody can take care of your babies as your own parents or relatives. You are there for each other and it increases the family cohesiveness and it also fosters savings. Frankly I know that it will never work in the United States but I have seen and read stories regarding how this economy is forcing many people to come back to their parent’s houses for financial and moral support. This kind of support can really reduce the cost of managing healthcare and less reliance on senior homes and hospice care facilities.

Tuesday, November 17, 2009

The next thing that was mentioned in what we can learn from China was the savings rate.

True we have increased our savings rate from near zero or even negative to 4 percent recently mostly due to the recession but the Chinese save almost 20 percent of their income. One can argue that they don’t have the safety net of social security, Medicare and Medicaid, unemployment insuranceand other governmental aid so they save that much. But to get the true picture, they have always been more frugal than the westerners. Even with our social safety net, we are still not able to save not much for rainy days relying solely on the government for our subsistence in case we fall into hard times.

We should see that all this safety net is our own money or the money the government seems to borrow to pay us in our hard times. We are dependent not on our government but on the foreign government who purchase our IOUs in order for us to survive.

Our hard earn income taxed to the max by the government in the name of unemployment insurance, Medicare, Medicaid and social security is already spent on recipients who are in the line. What we get in the unemployment insurance and other entitlements are paid for by our government IOUs to the foreign entities.

Since our savings rate is so pathetic and we tend to tax our savings too and give meager returns in earnings, people don’t find any incentive to save since they will know that their interest will be taxed at the end of the year.

The only way we can save is for the government to give incentives and encouragement to people to behave in a savings way. For example 401k is a forced savings no matter what all the experts in the world call it. But IRAs are not. But since the government encouraging savings will leave the economy in dire straits, our government will not do that anytime soon.

We really need to change our behavior regarding savings for ourselves and for our future generations so that in case of rainy day, we instead of panicking can rely on our own savings to weather the crisis.

I am sure kids also drop out of school in China too but since we are talking about America here we should know what many thousands of kids drop out of school every day. The reasons may be many but since the social cohesion is not there for these kids they feel the school a lot boring than exciting. The teachers pay is low but that does not mean that we should spend more on kids since the management of the spent money is the issue not the quantity.

Consistently we are reminded how the American kids are faring globally against their peers in the other developing and advance countries and the news does not seem to be that encouraging. The lesson we can learn from China is to put more emphasis on education, reduce the number of holidays and more time in the classroom and outside too. This is what our President is also emphasizing. Even with the No Child Left Behind act we are still nowhere where we should be as superpower. Everybody needs to step up to the plate from the teachers to parents, politicians to community and civic leaders to help our kids achieve their full potential.

Even if you take into account, the shipping, handling, real estate and fixed costs of the facilities, it still does not make sense to mark a shirt 200 to 300 percent of its original costs. I mean how much profit is enough for these companies. They keep on duping the American Public and they keep on getting duped, getting excited when they find a good deal (me included sometimes) not knowing that the companies are still making a huge profit.

The same stuff is sold in overseas countries more cheaply than they can imagine. A Chinese worker earns far less than their American Counterpart for the same type of shirt manufactured in China than in America. We will not be able to compete with other countries if we keep on ripping off the American public for things which costs next to nothing sold in America for prices which will never be charged overseas. It seems that we are subsidizing the lower prices overseas with our debt ridden income. This thing has to stop otherwise we will be only paper Superpower.

There was an interesting article about China that we can learn something good from them. Foremost was the education system. Although their children still do rot memorization as compared to American Kids but they study more and have more school days than us. There everybody gets involved in the teaching of kids because that is where the future lies.

Although our Universities are First Class and it is hard to beat them right now but to reach there we have to start investing in our kids and that does not mean spend huge amounts of money. We already spend more than other countries on our public schools with dismal results. It is not the quantity that we have to achieve but quality.

Monday, November 16, 2009

We have prodded the world to follow in our footsteps like democracy and free trade and openness but we were not ready for the explosive entrepreneurship spirits of China and India to bite us back. We thought that once their economies open, we will have an open market for our goods to sell them. We have succeeded partially in that course, but we still can’t compete with the low labor cost of those countries. Plus the tradition and culture that they have puts us in a disadvantage. We have been the catalyst or engine for the rest of the world’s economy buying too much stuff from other countries without correspondingly exporting our stuff to them.

We have preached and have been preaching Free trade to the world but if you fly into other countries, you would not see much of the American Stuff in their markets. Mostly the stuff is made in their own countries cheaper (and less inferior in some instances).

I still look for the American stuff to buy but to be honest and fair; we don’t produce much to boast. Our stuff is superior but it is expensive. There are so much burdensome laws to follows making our products expensive to buy here and less of it abroad.

We have opened our markets to the world but have failed to open other countries markets to our goods. We have been outsourcing everything in sight to other countries for cheap labor and then import back the finished goods from overseas at anywhere from 100 percent (very low and extremely conservative estimates) to 1000 percent profit.

Our President is right now visiting China. It is his first tour to that country to see first hand what the fuss is all about this “New China”. He gave a speech regarding the uncensored flow of information is necessary for a healthy society (something to that effect). But what he did not do explicitly was to talk about human rights, releasing of dissidents and other democratic rights that America Stands for. Because he may have known his limitations that America is not the same as it used to be ten years ago.

It is really a shame that America is not that strong as it used to be (some may have argue with that statement). But whatever we may say, this Great Recession has exposed us to many dangers. We have been pushing stimulus after stimulus without any money to pay for it and then hoping that whatever IOUs (treasury bonds, bills, notes) we issue the rest of the world will keep on buying.

Due to its unique strength being the sole superpower of the world, open economy, political stability and issuer of the No.1 reserve currency in the world, America can escape the scrutiny that other less advance nations can incur, but slowly and steadily this characteristics of the uniqueness of the American System will start to unravel. I don’t mean to say that all the above things will happen at once or all the things will even occur. I mean to say that when other countries start to develop much faster than America and have a less of a burden of a superpower, then things start to change.

Now people will say that entrepreneurship is not for everybody and you do not have direct access to all the cash. Well you are partially correct in that entrepreneurship is not for everybody, but how would you know it is not for you unless you try it. Further even if you are struggling with finances, you can still try to start selling some stuff on the side like in flea or swap markets and if you have internet, also on that.

You know everybody is struggling right now, but entrepreneurship is not dead or have gone to hibernation. On the Contrary, it is increasing with people of all walks of life; even in retirement are trying out on their own and finding immense satisfaction.

Well now you would say that if I am giving you this advice, why am I not following it, like practice what I preach. Well this blog is exactly what it will suppose to do (hopefully). I have another startup in the pipeline, which if I have enough funds raise with this, I will move forward with that. If anybody wants to jump in the ship with me, be my guest.

Waiting for the job market to return to normal levels will not make you any younger in the meanwhile. Why waste time waiting for the perfect or not so perfect job and starting brainstorming your next idea. Or even if you can’t figure out some great idea, you can always sell something or go online and invent something to make some extra money or alternative income. You can never know what you can hit upon unless you try. Because the human brain has infinite limitations and there is always something out there like your hobby or your passion about something which can turn it to your income.

Friday, November 13, 2009

I read an interesting article regarding how the MBAs are opting for opening their own startups rather than working for companies. The main factor for this trend is that it is a horrible market out there right now looking for jobs in the field of Finance and consulting (where a typical MBA thinks about joining the established companies after they graduate). The second reason I believe is that as compared to previous recessions, this one is the scariest since we may not be able to see the same level of jobs as before and also the mood of the country has turned sour for all those high paying executives on the Wall Street.

The third reason is that due to the uncertainty in the job market, the MBAs are trying to be their own bosses without reporting to the other people. As compared to before, it is far easier to open up your own start then to look for a desirable job. Although credit is tight right now especially for a startup but the internet has played a crucial role in lowering the cost of starting your own business.

You know I have always been in favor of starting your own business. Although your life style will change for a couple of years or permanently, you will always worry about where your next check will come from, the hassle of marketing to complete strangers, handle different payrolls, Government regulation and taxes,lawsuits,insurance, very long hours may deter anybody , but if you are going to work for somebody, endure ridiculously long hours and wait for your boss’s recommendation and the fate of company revenues and profitability to find out at the end of the year whether you will get your bonuses (if) and raises (if) which by way are not mandatory, it is better to follow and try to be your own boss.

There is no harm in trying. The only thing you loose is your time and money in the start, when you are young. But if you lose your job in your mid career then you can always use some savings if you have any to start your own business rather than waiting for someone to give you a job.

Kung Fu Panda is an animated movie. At first it was weird watching animals do the martial arts but when the Panda (voice of Jack Black) arrives on the scene, it starts to become fun. But I should warn you that it contains violence which may be too intense for the small kids. The Panda provides the basic humor in this movie and it is really the star of it. The animation is awesome but it is also dark and sometimes fast especially when the action sequences are taking place.

As usual the film is about Good vs Evil and the main theme is you have to believe in yourself. There is no secret formula that will help you in your life. It is you who will have to take charge of things. I don’t know if small kids would understand the underlying meaning of the movie but thoroughly it should be enjoyed by the whole family (if you are into animation-check it out). I would recommend it.

(Disclaimer: All the movies reviewed in this section are my own personal opinion. I have not been paid by the studios or by anybody else to review and analyze it. As such I am not responsible in anyway whatsoever if some or all of my reviews does not agree with some or anybody’s taste on that particular day when they are trying to watch the movie).

So here we are on this section of Movies. First up is Marley & Me- a dog movie about a couple (played by Jennifer Aniston and Owen Wilson) who adopt a clearance small dog who get to be a big playful one. The movie is feel good while the couple grows to five with three kids who also adore the dog. I would not tell you the ending lest it spoils your movie viewing but I can say that it is a feel good movie especially for dog lovers but it can also be enjoyed by the whole family-though to warn you that there are some intimate scenes between the couple that you may not want your kids to see, otherwise it is harmless fun. I will recommend it.

Thursday, November 12, 2009

I have always loved movies. Any kind of movie is fine with me as long as I don’t have to analyze the inner meaning of it. Currently I have watched over 6000 movies (crazy right).

Recently I have slowed down since I don’t have enough time but slowly and steadily I am watching movies which I enjoy. I also watch foreign movies (especially the Far Eastern ones). But if it is a good movie and I feel like the plot is good I will not care which language it is in as long as the subtitles are there. I know that some people have a hard time following the subtitles and following the movie at the same time. But once you start to watch it, it can be easier. Since depriving yourself of fantastic movies made outside the U.S. just because you refuse to make an effort to read the subtitle does not make good sense to me.

So in this section of the on the lighter side, I will be discussing movies which I like detailing all the situations in it, kind, description, appropriateness and overall rating so that you will have a better grasp of what you want to watch. Although it will be a very limited choice (again since I don’t have enough time to watch) but I hope to give you my own experience with the movie.

It will be a small section (word wise) depending upon what I have to describe as exactly

Regarding Investments in Myrtle Beach, you will find that if you are going to buy a condo or a house near the very nice part of Myrtle Beach, you will have to pay on average 200k for the house and less than that for a condo with ocean view, one bed and one bath only. But if like the beach you would love to have a real estate investment here.

If you live far away from this state and would like to come here two or three times a year, it is best to get a condo, since the maintenance is low and security is no problem. You just lock your condo door and that’s it.

Even if you can afford the condo with a ocean view, you still have a choice to move a couple of miles down the road and get what you want for less than 150k ( I checked it myself). But even if that is out of your range, you can move a little further away from the water and still get condos for 125k or less. I have seen new construction going for that amount for a townhouse on the main road. Land is cheap and weather is good so you should check out if you have a feel to buy a little getaway there.

Just to let you know apart from the beach (which millions of people visit every year), and some entertainment, there is not much work around here if you are thinking about getting some. You can start your own business but you would be depending upon tourist dollars (which is tight right now anyway) for survival. The lower cost of living means that you can still move here but don’t expect to be spending extravagantly since the pay scale and median income here is also low. But just as I said if you want to invest or retire, it would be one of the perfect places to do with less money and more relaxed life style.

Since it is near the water, you will find lots of seafood restaurants every where. For entertainment, you can go to the Ripley’s Aquarium. It is fun of kids and adults with sharks moving around you in a circular escalator. You can also see the mirror maze and other entertainments right across the beach. You can get discount tickets for the Ripley stuff at the Aquarium.

You can also go a place called Brook green Gardens (almost 18 miles from Myrtle Beach). It is a sprawling place (almost 9000 acres) of gardens and statutes. It so peaceful and tranquil natural environment. You can spend your entire day there with eating place right there.

Apart from the above, if you are a golf fan (which truthfully I am not), you can find many miniature golf courses there. I actually tried one right on the king’s highway in the hot 90 degree temperature. You really have to have patience for that game .If it was not that hot, I would have played all 18 holes, but the heat exhaustion got to me by the 12 hole, so I said adios to that place.

When you are from a busy city, you really feel the slowness of this place, which is a welcome relief in some sense. People drive slow and take there own sweet time in doing things around here. But the nice weather has lured many northerners to this part of the country.

Tuesday, November 10, 2009

(Disclaimer: I am not endorsing nor recommending any hotels or vacation spots and I have not been paid by the South Carolina Government or any of the tourist attractions to endorse their sites. Any opinion here is only my own and it should be considered as such).

Ok, here it is Myrtle Beach, South Carolina; I can say the Crown Jewel of the vacation spot in the East Coast. I went there this summer and boy it was fun. I stay right on the beach near a vacation building spot on the tip of Myrtle Beach called DunesVillage. It was a nice place to live with all the amenities of the apartment. You and your family can enjoy their indoor and outdoor pools and the best thing is their water park (the best one is the Lazy River-it was awesome). You can access the beach right from their property. Parking is right across the street with their own parking garage (no worry about the Parking there).

I took a flight out there- one hour and twenty minutes max. The flight coming back was a pain so next time if I go there I will drive. Almost 10 hours from New Jersey.

Since their apartments have every thing from kitchen to washer and dryer and LCD television, you just feel right at home. The only thing you have to do is to buy your groceries from the market (not far away from there) and stock it up. You can either cook yourselves and have a homely feel or have your food in one of the many restaurants that line up the main highway.

The beach is real nice to relax and chill out. Since the Myrtle beach is part of the almost 58 miles (not counted) of beach. You don’t feel it is crowded. I would definitely go back there again.

So here my here I am after talking about all the dry subjects and realities. Let us escape from reality for a while. I love to travel and see new places, but due to constraints (time and especially money-don’t we all) I have not travelled as much as I would like too. My wife also wants to travel but the same thing happens with her too.

But wherever I have travelled in the U.S. I have been fascinated by how diverse this country is with its natural environments and different settings. Every state and every city is unique (except for the currency and food- you will always find the Dollar and Fast Food everywhere). So depending upon where I have been before and where I will be going and where I would like to go, I will start documenting and relating all my experiences here in these posts.

Since I would not want you to be bored with what I did every hour of the day, I would be highlighting (and sometimes summarizing) what my experiences were and what I did and found fascinating about that place and what you should be looking for in that place.

So first up is the latest excursion that I took with my family which is Myrtle Beach, South Carolina.

I read a nice piece of article today about how C-Level and a little below executives are keeping up with the Jones even after being laid off by burning their savings account and their severance. This is the false sense that they will be able to find a job with the same pay level. It did not happen.

The amazing thing about the article was that (to be brutal) these people did not wanted to come out of their high horses and see the real situation going on around them. Just to maintain the same lavish life style even after being laid off is the height of arrogance and

(No offense) stupidity and absurdness.

The article goes on to document that these former executives now regret their decision not to cut down expenses. The surprising part of the essay was that they did get job offers but since it was below their level (meaning status) and salary, they rejected it. And now no job offers are coming, since the higher you go up the corporate ladder, the less jobs you can find. You can only have one CEO and one CFO instead of many down the ladder.

So the moral of the real life story is “ if the financial crisis come to rich people, save and cut down on expenses” stop worrying about what other people will think about your life style, since if they are so worried about it, they should chip in. It is easier to comments than to actually come to help.

Monday, November 9, 2009

Although my advice regarding real estate investment maybe too much for the smaller investments. It is still one of the most feasible ones out there amid all the carnage regarding the 401K, stock market, foreclosures. Now here is this thing that people can say that since all this craziness regarding the economy started with the housing market, then one should stay away from it for a while. But I have been stressing here that you have to have a financial discipline and control in order to invest wisely and prudently in the real estate business.

People have no doubt lost their shirts in the real estate. But there are many that have reaped great profit and wealth dealing in real estate (although they may not want to come out in the open about it).

Again your portfolio should be balanced with a mixture of all the right kinds of investment and how much risk tolerance you can take.

So my take on the real estate investment is not to spend outrageous amount of money on one property but spread it around in different states. Here I need to mention that this investment is not for the faint of heart. You need a lot of money and a great credit (possible above 780) and almost a complete debt free lifestyle other than your mortgages.

Just always start small and with one property. If you live far away from where you are going to find your investment, try to choose an apartment or a condo since they are easily to maintain and cheaper than a full fledged house.

But it is not to say that you can’t buy a land or house too. In some places land is abundant and you can get more than what you will pay for a single house in other areas. So choose your destination wisely.

Again this is not to say that you should put every dime of your hard earned spare money in the real estate. But it is safe bet that in the long term, this can be your best investment.

Again if I had money, I would buy some apartments in the south (cheap land and property and cost of living) and some land and farms in the north or Midwest and sell it later on. You would need to have a trust worthy property manager to handle all this investments. But in the meanwhile you can still enjoy your investments by visiting them.

So they finally did it. The House of Representatives passed the Health care Insurance Bill on Saturday by 220-215. So this was the good news. I guess since it was a vote based on party lines that is why the margin is so close so as to be negligible. To be fair I have not yet read the Bill but I am sure that the majority party leaders used all their resources to get the bill passed through. But the passage of the bill is not certain in the Senate, where there are already signs of a tough fight. The House version includes the Government option plan which is opposed now more in the Senate than in the House.

Now the bad news, whatever form of the bill we will get ultimately or not from the compromise of the two versions of the House and Senate, it is a sure shot bet that we the American Tax payers will be paying a lot more of the taxes than we are used too.

Look I am not a Republican or a Democrat or an Independent. I am a realistic who just see things as they are. What you see things around you, the economy is in a very big mess. We will definitely have to pay more taxes for this Health Insurance Bill (no matter what the Politicians and other people say otherwise) and debt servicing which is exploding day by day.

Friday, November 6, 2009

So as I was saying before, my favorite long term investment will be Real Estate. Now people will say that I (being a nobody) will start to give false hopes to people and start another bubble (oh no). But hear this, real estate supply is the same but demand is more since the population is growing and they may need housing and real estate.

Although Cash will always be king and the real estate is one of the most illiquid (meaning can’t be converted readily into cash) investments there is. But still now is the best time to buy a property and just keep it as a long term investment. You can use it as a collateral for your kids college education taking out the equity that you have built on it during the years.

You don’t have to go crazy on the real estate. If I had extra money (don’t we all except the super rich) I would investment in a combination of land and farms and some apartments in the U.S. and in Canada. I am specifying these two countries because you don’t want to be too far from this kind of investment since you will be taking care of the maintenance and enjoying your free time on it. And the fact that you can drive to it and these countries has strong laws to protect your investment.Europe can be another place but since you have to navigate all the different laws and languages of Europe plus it is so far away that you should stick to this side of the Atlantic.

Just to offer here my condolences to all the families whose loved one were taken away in this horrendous and senseless killings. No amount of support can replace what they have lost. It is now time for the base and the Pentagon to target those people who are very vulnerable to mental and disturbed patterns..

It is easier to act on suspicion now then to regret later. As details are emerging about the suspect, it is surprising that he was not targeted before. We are in a different kind of War right now, where we have to strike before the damage is done. We should be monitoring all the views and thoughts of all our troops to figure out what they are upto (although my view here will be very unpopular, but remember the military functions differently than the civilians that is why they have Military laws as opposed to Civil Laws).

We can’t wait for the person or persons to act before we catch them. The FBI has been doing a great job at that but the Military should also be doing much more since their personnel has more access to Firearms than the Civilian Population and they are under a lot of stress then the general Population.

So here we go again. Another month, another grim news regarding employment. Now the unemployment rate stands at official 10.2 percent, the highest in 26 years. GDP is growing and the employment is going down, funny combination. Well there is much to be done regarding the economy until it grows again with jobs. Without jobs, the so called recovery is meaningless. I have been looking at job postings on the internet job sites and the jobs seems never to get filled but still so much people are looking for jobs.

The employers have become choosy in finding people but they are not doing enough job to retain those people. I mean they ask for the best and perfect candidate and now they have a whole sea of jobless people and they still are unable to fill their positions.

No person is born with the skills that are advertised on the job sites. Even nowadays it has become a standard that you must have a college degree and at 1-2 years of experience even with an entry level starting job. I mean is that realistic.

I can understand the fact that firms don’t have the time to train people. But every time you hire someone, you will need to train them in the particular rules and regulations of the company. You can have the basic knowledge, but the procedures of doing something are different with every company.

Since the companies are now in the driver’s seat, they are becoming choosier whom to hire in the first place. Good for the companies, bad for the people chasing jobs. More on this later on in my future posts.

Another good news, President is signing up on the 20 week extension on the jobless benefits (last time I said it was 13 weeks) and home buyer credits too.

Thursday, November 5, 2009

This is the third part of the series of what investments to choose. It all depends on individuals risk tolerance. The people who are nearing retirement need to be aggressive about their investment, investing in the stock market, putting money in the CD (although the rate of return on it is pathetic), buy tax free municipal bonds (although I am not sure how long will it be when we the tax payers will have to bail out some municipality), real estate, buy government securities, etc.

The people who are young (meaning the one below the 50 year age) need to investment in some high risk investment (As they say in Finance, high risk high return) like stocks, max out their 401K (again although I don’t like 401K but it may be the perfect investment for most of the people) may be some real estate, put in some IRAs.

All my point is that you people need to diversify your portfolio (meaning investment) and not put all eggs in one basket (meaning not put all of one your money in one investment).

I read some stories long time ago that some of the people put all their funds that they have in 401K in their company’s stock and they lost all of it when the company went down ( Bad idea-never do that).

My favorite one will be very controversial but that is just my opinion, it is real estate.

So the Congress is all set to extend the Unemployment benefits for another 13 weeks I believe. Well it was about time they did. I have so many heart wrenching stories about people losing their Unemployment benefits- their last lifeline before they go on welfare that it just disgust me.

I have read that people are losing your homes, raiding their savings account, their retirement accounts, living on the road on RV (recreational vehicles) and still can’t manage to land a decent job even if they lower their standards. Is this is now going to become the NEW AMERICA. I hope not.

Another news came out today, which I have already posted before that the companies are doing more work with less employees driving up the productivity. So instead of hiring more people, the companies are making do with fewer employees, which is not good in one sense, since the less people have jobs, the more it will hurt the economy. So again we (meaning the Government) should do more to focus on creating good paying jobs or for now at least some jobs, so that people have confidence to go out and do their part for the economy ( meaning spending).

So at last Yankees won the World Series (in baseball) after eight long years (the last time they did in 2000). Good for them. The stadium was crowded to the max. So the baseball is yet to be a game which is affected by the recession. It is amazing that even with the advent of television and all the slow motion effects that the TV can provide from every angle and also in the comfort of your own home. There is something unique going to the ball game and experiencing it live in front of your own eyes and the recession has not dampened the enthusiasm of the Baseball fans.

On the players side Hideki Matsui did what he had to do. He was really great and he deserved the MVP (Most valuable player) award. So Congratulations again to all you Yankee Fans and Baseball fans for an exciting Baseball season.

Wednesday, November 4, 2009

Hey folks-rich and poor, middle class and more, the Feds have decided not tinkle with the interest rates for a while (meaning for the next six weekly meeting unless something urgent comes up, but they can’t go negative. Oh wait they have given free money anyway so the rate is actually negative).

Now we can keep on buying stuff on ultra low rates (if anybody is willing to lend me the money) till the next crisis comes along. Cynical or Sarcasm you decide. These low rates are not benefiting me since the rates on credit cards are not link to it. And neither are the mortgage rates and the car loan rate. They have their own language and criteria to evaluate your creditworthiness. So the free or interest free loan is not for us (you and me) but for the big guys (very). But I understand their concern for the economy and unemployment rate. But they can’t go further than what they have right now, so it is going to up from there in the future, so stay tuned.

So as I was saying the much hyped and beloved of almost all the experts has its advantages. It sits in the account entrusted to a company tax free until you take the money out at retirement (age 59 ½ year I believe). You can expect to receive a matching fund from your company (if they have that policy), and you don’t have to worry about checking your investments since it is done by the company managing your 401K. The only thing that you do is to allocate your money among stocks, bonds etc. I just call this lazy man’s investment. I call this because you just allocate some percentage of your money and just let other people handle it.

Well in order for you take care of your own money; you have to actively manage it, meaning doing some research on which company is doing how and so on. I guess it does not take that much time if you put your mind and effort into it. But I guess we (meaning the investors) are so busy or just plain on lazy (no offense) that they just let other people do their work.

I call 401K. Although it may be perfect for millions of Americans but for me I do not find it attractive (except for the matching funds (call it free money) at the end of the year. It is forced savings and if someone can be a little more disciplined in their financial matters, they can earn far more income on their investments then they can with investing in 401K. I have several friends who have lost a lot of money in 401K but lack of a better alternative or just plain old laziness (I dare say), they keep putting in more money into it.

The last post was in the first line it was a DISCLAIMER NOT DISCLOSURE

So finally the election of 2009 has come to pass. Very big upset for the Governor race in New Jersey as the Incumbent Democrat lost to the challenger Republican (even who had less money than the Incumbent). Virginia was another case where the Republicans took over. Although the Mayoral race in New York was a foregone conclusion, but the margin by which the Incumbent Mayor won despite outspending the Challenger was surprising.

Although the Mayor of New York calls himself from neither party but he has actually be running on a Republican platform without mentioning himself as such.

Although people are saying that this election was a sort of vote of Referendum on the President Policies. I don’t see it that way (not that early I think). It was about local issues but it can also be called a forewarning to the ruling party that they better be careful not to increase too much taxes lest they can also go the way of what happened on November 03, 2009.

Again as I said earlier, instead of looking at how the Politician can win the next election, they should concentrate on getting what is right for their constituency and what the voters have voted them for. I know that will be hard to do, but that is the only way to ensure we are on the right track for the country. The election will take care of itself, once the voters see what their Politicians are really accomplishing.

Tuesday, November 3, 2009

(Disclosure: I am no Financial Adviser and have no certificate or credentials to advocate any type of investment over another. This is just my opinion only and should be looked at such)

I have been reading and hearing advices left and right of all the financial advisers and experts regarding what and where to invest your money and I still don’t get it. First of all they (experts) keep on insisting not to cash in your 401K but let’s see what else you experts want them to do if they have no money in their accounts and they are literally living hand to mouth with no end to their miseries. I can see that you will have to pay a penalty of 10 percent plus all the income taxes levied on the withdrawn money. But what else is there. No body is lending out money right now and if they do they will need some collateral. It is easier to give advice when you are not in their situation.

Another thing that these experts say that you would need your 401k along with the social security income to live through your retirement age. Well folks the people who need money now are in their retirement mindset. You need money right now and if you don’t get it now then how are you going to live upto your retirement age.

The people who want to cash in their 401k are really desperate people, they are not just getting up in the morning one day to say let me cash in my retirement pay. They may or may not (probably may) have exhausted all other options of getting funds from elsewhere before coming onto this scenario.

Dear Experts, touching or cashing out your 401k would not be the end of the world for some people. You can always build it up and second of all it is your own money, you are the best judge of how to use your money and nobody else knows your complete circumstances than you do. I stopped my 401k many years ago and I don’t that fear that my future would be screwed up just because I have very little in my 401k. If I need the money now I will definitely explore any options to get my funds before turning to strangers.

The stock market have reached 10,000 points in Dow Jones Industrial Average, Gold is near $1,050.00 and crude oil is near $ 78.00 every trader and investor who has substantial money out there is jubilant and excited but the main engine of the economy-the consumers are in no mood to celebrate. What is going on? Are we looking at undue excitement without the major confidence index of the consumers down in the dumps?

As I have been pointing out again and again, we need job growth to accompany all this euphoria about the economy and until this is done, all these highs are just that pure speculation (only my opinion).

I don’t know who is drumming up these figures, but the consumer confidence is still low compared to historical standards. People have lost tons of money in real estate and stock market and they are in no mood to invest now. Consider also the fact that the news came out yesterday that most of the biggest companies are sitting on almost $1 trillion in cash in their balance sheets for the rainy day (I guess). So instead of investing that cash and generating some jobs, they are hoarding up cash because of the uncertainty which is right out there if you can see.

Because you will be able to see not one or two topics but several topics.As you have been reading my blog, it seems to many that I am just talking about all the economic aspect. But this is really not my intention. I just feel that I had more to say about what is happening right now and what I am thinking things are going which way. But since my blog is all about opinions of mine. It will not be limited to only economic news, but any thing which I think merit my interest, attention, passion, concern, excitement or worry.

If you have seen my previous blogs which I have called on the lighter side, it deals with sports, although baseball is all the rage (and in it too I have inserted some economic analysis of mine) but it can be any sports which I watch or think deserve my attention. On the lighter side will also include all forms of entertainment or anything to break the mundane routines or worries of life. Tips of where I have travelled or things to see etc will be part of this series.

So keep on logging on and sending me your comments since I intend to be a prolific writer about anything which I find interesting or not.

So this World Series has started to become too exciting. Both of the teams Yankees and Philadelphia Phillies are strong competitors. For all of you baseball fans it has been an exciting series with ups and downs coming through at the last minutes.

One curious thing that I saw (I am just learning the game rules) in the stadium was that it was jam packed. I guess no matter what the economic situation or mess we are in with all the grim news regarding the foreclosures, bankruptcies and joblessness, people find enough money to go to these ball games. Or you can say to escape the grim news this may be their way of saying I had to enjoy this game no matter what.

Look at what is happening to the Movie industry, since or because of the recession the price of tickets have gone up and so is the revenues of the movies (but not the attendance).

People want to escape the reality. It is too stark and whatever their economic circumstances, they will continue to enjoy the cheapest form of entertainment they can find with their families, whether it is movies, sports, a small meal out at night or taking short vacations near their homes.

So did everybody have a Happy Halloween or not. I know I did since I had a temporary job but who cannot be. Many parents in this economy who do not have a job go all out of their way to make their kids happy and not make them realize that they are financially in trouble. But I guess kids nowadays are too smart for that. I am still working a temp job (since the last 14 months) but my kid does not know that and I want to make sure she does not since it is our (parents) responsibility to make sure the kids are taken care of.

More news came out today that pending home sales rose for the highest level in three years and manufacturing also expanded. Well good for them but still I am a little more skeptical regarding the job situation (the monthly jobless rate is going to come out this week I guess).

Most of the employers are still more hesitant to hire more people or they are getting use to the fact that they are in the driver’s seat and can be choosy about whom to hire. Anyway when the confidence in the economy grows then we can see the jobless rate go down but in the meanwhile lets hope for the best.